India's new GST, like Delhi, wasn't built in a day

AT the stroke of the midnight hour on Aug 15, 1947, India made its deal with destiny, upon its declaration as an independent and sovereign Republic. Nearly 70 years thereafter and again at the stroke of the midnight hour marking July 1, 2017, India implemented its most vital tax reform in the form of the Goods and Services Tax (GST).

The introduction of the GST is significant in how it embodies the principle of "One Nation One Tax" that is aimed at ending the complex web of indirect taxes and putting them into one blanket tax net. The rollout of the new tax marks a massive exercise in fiscal federalism essentially converting an economy of more than 1.2 billion consumers, 29 states, 22 official languages, nine million businesses into a single unified market.

Before we proceed further, let us set the tone for this article with an old but slightly altered adage "(Delhi) wasn't built in a day". Accordingly, all those who expect a hassle-free GST for India right at the start would need to reflect and realign their expectations to a realistic level which is consistent with GST implementation experiences across the globe, (with the exception of Singapore when then-Minister of Finance Richard Hu declared the implementation of the GST on Day 1 to be a non-event in Singapore).